Mr. Market as Servant Not Master

“Ben Graham [had] his concept of “Mr. Market.” Instead of thinking the market was efficient, he treated it as a manic-depressive who comes by every day. And some days he says, “I’ll sell you some of my interest for way less than you think it is worth.” And other days, “Mr. Market” comes by and says, “I’ll buy your interest at a price that’s way higher than you think its worth.” —CHARLIE MUNGER, USC BUSINESS SCHOOL, 1994”

“Ben Graham pointed out that markets are largely composed of such people as “[person] A [who is] trying to decide what B, C, and D are likely to think—with B, C, and D trying to do the same.”13”